American Housing: New judges on case

Parties closer to court date

Many of the parties involved in the American Housing Foundation legal brawl are now on their way to having their day in federal bankruptcy, state district and probate courts.

Senior judges appointed replacement judges on Wednesday to hear the probate of AHF founder Steve Sterquell's will. They'll also hear a case in state court involving several creditors alleging a partnership guaranteed loans for AHF and now owe the money.

Sterquell died in a car crash April 1 that was ruled suicide.

Since May 4, his family has tried to file his will and get it probated, but they asked that the case go from Potter County Court to County Court at Law No. 1. Judge W.F. "Corky" Roberts recused himself, so Joe Loving, a retired judge in Dallas, will hear that case.

And 181st District Judge John Board recused himself from hearing a civil suit filed by creditors. Newly appointed Judge Quay Parker now will hear that case.

A motion to dismiss an involuntary bankruptcy filing against the foundation is pending a hearing in federal court June 11.

The Sterquell family has asked that Steve Sterquell II be the executor of his father's estate, but creditors want an outside administrator. Sterquell Sr.'s will leaves everything to his wife, Marshallette, except for some personal mementos and family heirlooms. The estate was worth $12.4 million in 2007, with $9.12 million of that in an individual retirement account, according to court records.

The family objects to appointed administrator Henry Davis, describing his current role as an "inside" investigator for "so-called" creditors. The family fears Davis won't protect the best interests of the estate because his attorneys are the same as the creditor's.

Another challenge to the family came Tuesday from American Express, which is claiming Sterquell Sr. had credit card debts totalling about $243,000. It filed a claim with the estate for payment.

A third claim on the estate also came Tuesday when multiple creditors demanded payment of $14.75 million. They say Sterquell Sr. was personally liable for some of the debts run up by AHF including a $2 million note that Herring Bank extended until March 28. It carries a $360,000 added charge to buy the extra time.

Some of those same creditors sued Multi-Family Rehab Partners on Wednesday, a partnership consisting of AHF, Catherine Koehler, Mary and Maurice Schooler and Louise Conley. Multi-Family Rehab Partners guaranteed loans for a variety of projects including Three Fountains and River Falls apartments in Amarillo.

AHF buys, renovates and manages affordable housing projects across the south through more than 250 partnerships and corporations registered with the Texas Secretary of State's office. The foundation listed debts of $459 million in its 2007 Internal Revenue Service filing.

According to the foundation's Web site, it operates 14,000 apartments plus housing for university students and senior citizens.

Many of the creditors are trying to force AHF and members of Multi-Family Rehab partners into bankruptcy. However, the foundation's lawyers say federal law prohibits involuntary bankruptcy for a nonprofit. The partnership's members say they were tricked by Sterquell Sr. into guaranteeing the loans, and the amount of the debts are disputed.

The creditors claim the proceeds of $24 million in life insurance policies covering the elder Sterquell were held by AHF until just before his death when he changed the beneficiaries to trusts controlled by and benefiting his family.

The creditors are asking for that money to go to pay the debts they allege.